Why give at the office…

March 1, 2010 by bryandear

 When it comes to life the critical thing is whether you take things for granted or take them with gratitude.   - Gilbert Keith Chesterton, 1874 – 1936

Presumably we all give all the time. You may give time to your children, your friends, your church or to a host of multiple causes. Whatever you choose to give to, give to something that gets you fired up.

This comes from personal experience. Long ago, I thought I should join a well know organization that has a wonderful cause to support – as long as you believe in it. I didn’t really care that much. I was there for the wrong reason – to make contacts and to help in a capacity I thought they might need. But I was so wrong for that position.

Whatever cause I choose to support in a major way now, I have to believe in it and at least be able to get fired up about its purpose. That makes donating my time and my money a lot easier.

I do believe that giving wholeheartedly to a purpose will feed back rewards that were not contemplated with the gift. The more the gift is released without strings, the stronger the give back will be.

Yes, that can be a bit tough. I would like my name in lights (on occasion), I bask in appaluse as being the “generous guy,” but the more I can distance myself from these frivolities, the better I will be served in my life. And the more I can give.

Give – give it your all. Why not? This is your life, your candle to hold and share a light into the darkness and your blessing of who you are. Give at the office, give at home, dare to throw it out there and while you’re not paying attention, I believe your gifts will come soaring back to you.

Bryan Dear

www.payrolldept.biz

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How many exemptions should I claim on that W4?

March 1, 2010 by bryandear

The way of the world is to make laws, but follow custom. Michel de Montaigne, 1533 – 1592

We hear this question all the time. How many exemptions (or dependents) should I claim?

The W-4 form asks for name, address, social security number, married or single status, and how many exemptions you wish to claim. Most people can get through all but the exemption piece with very little assistance. It’s the number of exemptions that’s the stumper question.

Most people realize that the more exemptions they claim, the higher the paycheck they’ll receive. Of course the counter to that is you’ll receive a lower refund (really not so bad) or you will owe (perhaps really bad) come tax return time. It’s a little bit of a dance choosing the appropriate number of exemptions.The W4 worksheet can be helpful which is the upper part of the W4. A more helpful worksheet is the IRS W4 calculator.

You can use the IRS worksheet calculator by going to this address:

http://www.irs.gov/individuals/article/0,,id=96196,00.html

And then there’s the state. Many states actually have higher taxes at the lower tax brackets. That’s because the federal government doesn’t tax you until you have met a minimum amount. Some states have their own W4 and some states use the federal w4. Regardless, you may always specify that you want more or less exemptions for your state income tax withholding.

Everybody’s income tax return varies and what’s right for your buddy who looks like they make the same as you may not be the case. Use the calculator or at least the worksheet. Review each year after you have filed your tax return. You may want a lower refund so claim more exemptions. Of course you may still be stinging from that unplanned check you had to write to the IRS or your state – claim fewer in that case.

You may also specify that you want additional amounts of tax to be withheld in addition to whatever the tax tables are calculating. Perhaps you are married and you know you need more money or the stimulus bill may have given you back too much money through your paycheck. You may have extra income from investments. Review your paycheck halfway through the year and ask yourself – does my withholding equal about half of what I withheld last year? Am I pretty close to the same income as last year? If either answer is no, make adjustments.

Happy claiming,

Bryan Dear

www.payrolldept.biz

Posted in Payroll - Regulations - OT | Leave a Comment »

It’s not that Simple (retirement plans) but it’s easier than a 401k

February 11, 2010 by bryandear

I love the challenge of starting at zero every day and seeing how much I can accomplish. - Martha Stewart

Retirement plans are a great benefit for employees – they come in all shapes in sizes and one plan may look very different from another plan. SIMPLE IRA plans are relatively simple compared to 401K plans, but they are not without complication. If you have less than 100 employees, establishing a SIMPLE retirement plan is one of the lowest cost retirement plans an employer can offer.

From a payroll perspective, it goes something like this.

The employee may contribute up to $11,500 a year in 2010 and if they’re fity or older, may contribute an additional $2,500 for a grand total of $14,000 for the year.

In general, the employer must match up to the lesser of the employee’s contribution or 3% of gross compensation for the year. Gross compensation includes bonuses, overtime pay, vacation, sick and personal use of auto in addition to regular pay. However, gross compensation must be reduced by Section 125 deductions (Cafeteria plans such as pre-tax AFLAC, FLEX spending, Dependent Care, etc.). A good rule to determine gross compensation is Box 1 wages from the W2 plus the employee’s Simple Contribution. This definition of gross pay becomes important in determining the 3% match from the employer if the employee has contributed more than 3%.

The employer does have a couple of additional options. They may reduce their match from 3% to 2% two years out of every five years. The employer may elect to just contribute 2% to every employee retirement account regardless of whether they contribute or not.

How much should an employee contribute? One very general rule of thumb is for employees to contribute 10% of their gross pay a year. If the employer is kicking in 3%, then the employee would contribute 7% of their compensation.

The employee contribution must be made within thirty days after it is deducted from pay. The employer contribution can be made at that time, but the employer may also wait to make their contribution until the filing of their tax return. Regardless of when the employer makes the contribution, the match amount should be compared to the W2 Box 1 amounts and employee simple contribution to determine what the match should have been so that adjustments can be made.

Employee withdrawls after age 59 and a half are subject to federal and state income taxes. Employee withdrawls prior to that time are taxed for the full account value with an additional 10% tax thrown in with some limited exceptions. Employee contributions are deducted pre-tax for federal and state taxes, but not FICA and Medicare.

Employer plans can be set up with the big guys such as Vanguard and Fidelity or they can be set up with a local broker who may provide more guidance and personal service. There’s usually a greater fee with a broker which is found in higher asset fees.

SIMPLE plans are a great way for an employer to enter the retirement benefits arena. They are relatively easy to set up and provide a wonderful vehicle to help provide employees with a retirement plan.

Keep it simple,

Bryan Dear

www.payrolldept.biz

Posted in Payroll - General | Leave a Comment »

Grateful and giving thanks

November 10, 2009 by bryandear

Develop an attitude of gratitude, and give thanks for everything that happens to you, knowing that every step forward is a step toward achieving something bigger and better than your current situation.     – Brian Tracy

In my periods of doubt – and they do happen – I can forget this attitude of gratitude. I have everything – good health, a great partner in my marriage, good family ties, wonderful friends, wonderful co-workers, great community, lots of recreational time, learning time and a successful business by all sorts of measures.

How can there be doubt? Because in whatever situation we find ourselves, there is a tendency to want more. Gratefulness re-orients us. Wow – I am fortunate. I am grateful. And the next step from there is to:

Give thanks. I don’t give enough thanks through either saying so or through actions. It’s one thing to say “Thank you.” And that may be appreciated. It’s another to say thank you through actions.

A note, flowers, a gesture out of our way can mean so much to those we live among. Even a detailed comment regarding why I am thankful such as, “That was such a great method you showed us for that different, and more effective, way to enter that time off accrual.”  Don’t forget, we’re in the payroll area, but it can be in any part of your life.

Thank someone in a special way today – you’ll be amazed how it impacts you.

Thankfully yours,

Bryan Dear

www.payrolldept.biz

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Identity – What identity?

October 29, 2009 by bryandear

We learn geology the morning after the earthquake. Ralph Waldo Emerson, 1803 – 1882

I’m not sure where my house key is and that’s because we don’t lock our doors. I mean really, what would a thief take? Our TV? Our furniture? They could take the laptop, but even there we don’t keep much personal information on it and we certainly don’t keep passwords on a file in our computer. If someone did break into our house, we would at least have the option to start changing account information to prevent loss of data or money from falling into the wrong hands.

It’s a different set of rules for the cyber world. You may not realize your identity has been stolen. It’s a much quieter theft. The theft can occur from somewhere you have no control over.  It can be scary to realize how much information is available in the electronic world that concerns you. And there you sit comfortably at home or at the office thinking that all is safe and secure when in reality the stuff is about to hit the fan.

So what are you to do? Drop out of society? Do you move all of your electronic data to paper and create a tremendous amount of inconvenience for yourself while still making yourself vulnerable to a different kind of theft from paper? I doubt it. What follows is a game plan for your life when it comes to data protection.

You are entitled to a free credit report from one of the three credit agencies once a year (beware of the free credit report agencies that want you to sign up for a paying service). You may go order this free service by going to www.annualcreditreport.com

Review your report carefully for accuracy noting any activity from creditors that you did not initiate.

You may place a “Fraud Alert” on your credit report by calling any one of the following agencies – a call with one will place the alert with all three agencies. The number is: Equifax – 800-525-6285 / Experian 888-397-3742 / TransUnion 800-680-7289

We here at The Payroll Department, Inc. deal with incredibly sensitive information. From a thief’s perspective, we are a gold mine. We do everything we can to keep your data confidential including multiple firewalls, strong passwords, data encrpytion as well as many dual controls in the office. And still, we are vulnerable. Recently, our software vendor, Paychoice, was attacked and our online clients were provided with a phishing email noting they needed to update their software. If you have one iota of doubt about whether something is from us, contact us. We would not ask you to download something from an email without contacting you by phone, fax or written notice.

I don’t sleep well when I think our data could be hacked. It’s an amazing world full of grace, but evil lurks there too.

We’ll protect from evil – we’ll love the grace – and we’ll keep our data safe.

Sincerely,

Bryan Dear

www.payrolldept.biz

Posted in Payroll - General | Leave a Comment »

27 Bi-Weekly Payrolls – what to do?

October 1, 2009 by bryandear

Thinking is easy, acting is difficult, and to put one’s thoughts into action is the most difficult thing in the world. Johann Wolfgang von Goethe, 1749 – 1832

When you run a payroll every two weeks, you can reliably compute twenty six payrolls a year (26 x 2 = 52 weeks). If you pay salaried employees on this bi-weekly schedule, you may have taken the annual salary (e.g. $52,000 and divided by the 26 weeks for a bi-weekly salary of $2,000 per payroll). This is all fine and good for most years.

However, every so often there are twenty seven payrolls because three hundred sixty five days divided by fifty two leaves a remainder of one day. Leap year enters into the equation so really it’s only every eleven years or so that twenty seven bi-weekly payrolls will occur in your payroll calendar.

Do you pay the salaried person for the “extra” payroll ? In the first example, you could pay your salary person the additional $2,000 and proceed as normal. Many employers, however, believe they have contracted with their salaried employee an annual salary or a monthly salary. The reasoning goes that the fact that there happens to be an additional payroll should have no bearing on their annual or monthly salary.

If you choose to forgo paying your salaried employees, you’ll want to be very clear in your communications with them including providing them with plenty of notice so they can plan their finances accordingly. Look ahead in the calendar.

January 1, 2010 falls on a Friday. Depending upon your bi-weekly pay schedule, next year might be the 27 payroll year. Or if you move January 1,2010 to December 31, 2009, you may have 27 payrolls this year (2009).

Take a peek at your calendar for this year and the next. If you see twenty seven payrolls, you’ll have a head start on whichever way you proceed.

Cheers,

Bryan Dear

www.payrolldept.biz

Posted in Payroll - General | Leave a Comment »

What you don’t know, might….

September 23, 2009 by bryandear

His ignorance was an Empire State Building of ignorance. You had to admire it for its size. Dorothy Parker, 1893 – 1967

When it comes to payroll, the following statements would be best to avoid:

I don’t have to pay overtime because I didn’t authorize it. (It doesn’t matter – you may choose to discipline the employee, but you still have to pay them for the hours worked including the overtime premium).

I’m tired of paying overtime. I’ll just put them on salary. (Bad idea. The question is whether the employee is exempt from overtime. Paying an employee a salary is irrelevant to this determination).

It’s easier to pay my employee as contract labor. (Do you like wearing a big bullseye that says, “Audit me.”? The IRS and more importantly, the states are looking for as much money as they can in these times of declining tax revenues – don’t get in their path.)

I don’t need an I9 or an Affirmation of Legal Work Status from the Colorado Department of Labor -  all of my employees are legal. (Doesn’t matter – audits can either be no big deal or a real pain depending on how prepared you are. Get both of the these documents dealt with when you hire each employee).

All retirement plans are not only pre-tax for federal and state, but are pre-tax for social security and medicare also. (No, no, no.)

This garnishment can wait when the employee can better afford it. (Not a good idea unless you want to pay the garnishment instead of the employee).

All of the above done the wrong way could cost an employer a lot of time, aggrevation and money. If you’re unsure, google the question. If we can help, contact us.

We’ll help you keep your head out of the sand.

Bryan Dear

www.payrolldept.biz

Posted in Payroll - Regulations - OT | Leave a Comment »

“Comp Time”

September 9, 2009 by bryandear

You don’t need to interpret tea leaves stuck in a cup, to understand that people who work sitting down get paid more than people who work standing up. Ogden Nash, 1902 – 1971

Comp time is time off earned for time worked over a certain amount, usually 40 hours in a week. What comes as a surprise to many employers is that there is no such thing as legally paid comp time for non-exempt employees unless you are a  municipality. If your employee exceeds the 40 hour work week limit, you must pay overtime.

But let’s say you have exempt employees that you would like to set up a comp plan for. It’s your plan – you don’t have to offer one – so you may be very creative in how you establish your plan.

 You could reward your exempt employee and yet minimize cash flow by offering a comp plan for them to take off hours based on hours worked over 40, 45 , 50, etc. in a week. You could base the plan on billable hours that exceeded a weekly total.  When you award the hours, you could reward hour for hour or at time and a half.

You would want to be consistent with your exempt work force by creating the same plan for employees who could be classified together. And you would want to track comp time earned as well as comp time used – preferably on the employee’s check voucher.

Comp time is a tool to reward your work force. It just can’t be used for your non-exempt work force (unless you work for a muncipality and even then there are rules to live by).

Cheers,

Bryan Dear

www.payrolldept.biz

Posted in Payroll - Regulations - OT | Leave a Comment »

BNTP

September 1, 2009 by bryandear

There is only one way in which one can endure man’s inhumanity to man and that is to try, in one’s own life, to exemplify man’s humanity to man. Alan Stewart Paton, 1903 – 1988

If you haven’t met my Father, then just hold on – eventually you will. My Dad goes out of his way to say hello and strike up a conversation with people he has never met. There is no fear of strangers – he thrives on the interaction itself.

When I was growing up in the family, we on occasion would go out to eat. We rarely would see Dad at our table because he was making the circuit around the restaurant not only with people he knew, but with people he had never seen before. A hello here, an admiring remark there and pretty soon Dad had people feeling good about themselves.

So BNTP comes from my father – Be Nice To People.  It’s a simple dictum. It’s a simple philosophy. It’s easy to remember and it’s easy to recall. About the only thing that isn’t easy is the constant practice of it.

BNTP is easy when we like the person we interact with. It’s a different story when we don’t seem to have the time, we don’t have much of a relationshp with the person or heaven forbid, have not even met the person.

Keep it simple – just like BNTP. A smile, a chuckle, a bended ear or even a twinkle in the eye can all reflect kindness upon any human being.

Here’s to my Dad and to all who put light into our gray,

Bryan Dear

www.payrolldept.biz

Posted in Work Environment | Leave a Comment »

Promptness

August 24, 2009 by bryandear

Ideals are like stars: you will not succeed in touching them with your hands, but like the seafarer on the desert of waters, you choose them as your guides, and following them you reach your destiny.     - Carl Schurz, 1829 – 1906

I have worked with many people who I genuinely admired who could never arrive on time whether it be a professional or a social occasion. I have also worked with those who didn’t have my admiration and didn’t show up on time, but they always had a wonderful excuse. And I have worked with people who always show up on time – most of the time earlier than the agreed upon time – these are the people I can count on.

Last night at the movies, one of the main characters was a working mother and she was always late to her job. It was a trait I suppose her co-workers accepted, because she was good at what she did.

How do you handle an employee who is always late? Does it make a difference whether they are a great employee or just “doing their job?.” Do you treat them differently in evaluations? Is there a pay differential? Do you make exceptions? Business decisions like these, no doubt addressed in ye olde employee manual are supposed to be cut and dry… but they rarely are.

The larger the company, the dicier this gets with consequences not even considered previously. Make sure you document the tardiness.  Make sure the employee knows why their behavior matters to you and your company. If you don’t have a good time keeping system, get one. They’re  not that expensive and they’ll you time and money in all sorts of areas. And finally address the consequences of tardy behavior – even for your good employees.

Promptness is a kind of code – it doesn’t just happen – it requires some planning, it shows respect and it allows for the task to be accomplished when everyone is engaged at the same time. It also sends a strong message – you can count on me.

It’s a rainy Monday – no excuse for being late:-)

Bryan Dear

www.payrolldept.biz

Posted in Time and Attendance | Leave a Comment »

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